Bitcoin's got a spending problem, and entrepreneurs are reacting with crypto debit cards to solve it. Say you've got some crypto-currency -- maybe a Bitcoin or a little Ethereum -- and it just went up 10 percent, and you now want to splurge on a long-overdue vacation to Europe.

In the past, you had to go to an exchange, like Coinbase, and turn a set amount of your cryptocurrency into a set amount of national fiat currency ($U.S. ?U.K., etc.). After that, you moved your fiat currency into a bank account. And only then, finally, could you spend it.

Crypto debit cards are like regular debit cards. They've got a Visa or MasterCard logo. They work everywhere. But, instead of pulling from your bank account, they pull from a cryptocurrency wallet. Confused? Here are the basics:

What is cryptocurrency?

Cryptocurrency is virtual money. It's created by algorithms and sustained by computer networks run by real people and serviced by profitable corporations. It's money that isn't subject to direct devaluation through political means, the way fiat currencies are. And it's very hard for governments to confiscate.

Cryptocurrency can move across political borders without delay, taxation or notice -- much like email. It's also relatively new, less than a decade old, and it's just seen its first unicorn (Coinbase). That means it's primed for new waves of venture capital in the short term.

One unit of the most popular cryptocurrency, Bitcoin, is currently worth three times the value of one ounce of gold, and it's considerably more portable.

Bitcoin has a hard limit of 21 million total units, which is expected to result in deflationary pressures once that limit is reached. Ethereum, second in popularity after Bitcoin, is not just a currency but also a smart contract platform. You can program smart contracts to help people exchange anything of value in a conflict-free way, without middle men -- sort of like a vending machine.

Speaking of middle men, what about banks? Cryptocurrency has the potential power to eliminate them, along with their fees and limits. And its transactions are nearly anonymous and shockingly inexpensive. In short, cryptocurrency -- and I say this as someone who owns cryptocurrencies and thus has a financial stake -- is the future of money. And it's a field that has a lot of room for new startups.

Spending is the challenge.

With more than 900 cryptocurrencies out there, access to opportunities for earning, trading and investing them has not been a problem. The challenge now is how to spend them in the real world. So far, we've relied on a ragtag DIY network of ATMs and QR-code apps.

The new thing, however, is that we can now use crypto debit cards -- a bridge between the crypto world and the bank-card point-of-sale world that everyone is familiar with. Crypto debit cards are frictionless for beginners and easily understandable. They're making crypto mainstream for regular consumers.

Why crypto debit cards?

Crypto debit cards offer a lot of benefits over both the old way of trading cryptocurrency for fiat at exchanges and the traditional spending of fiat currency via credit and debit cards. They include:

Freedom. You can now spend dozens of cryptocurrencies and tokens at businesses worldwide without having to worry about exchanges or exchange rates. You can buy just about anything you want with bitcoin and other cryptocurrencies. This could be the tipping point for cryptocurrency.

Usability. You can spend your crypto holdings now as easily as you use your Visa or MasterCard. Buy groceries, order pizza and pay the bills all without having to pre-convert your cryptocurrency at an exchange. Or withdraw cash at thousands of ATMs. Conversion is now painless and invisible. You can spend freely, and live purely on Bitcoin -- and no one will be the wiser.

Universality. Visa and MasterCard are accepted almost everywhere. Never again will you need to ask if a vendor accepts Bitcoin. No more hunting for buyers on LocalBitcoins.

Flexibility. Many crypto debit cards enable you to spend Bitcoin, Ethereum and other coins and tokens, so you've got lots of choices when it comes to how to hold your money and which of your crypto holdings you want to liquidate.

A buffer against inflation. Crypto debit cards are a lifesaver in places where the local currency is volatile and/or inflationary. You can hold your money in crypto and spend only what you need; you'll also get the best exchange rates.

Increase adoption. When more regular people can spend their crypto holdings -- and profit by doing so -- they'll have more reason to ask for payment in cryptocurrency as well, and less reason to hoard it. Also, now merchants can effectively accept Bitcoin -- and not even know it. They'll get paid in their preferred fiat currency.

Rewards. Many crypto debit cards offer reward schemes that will give you an advantage over spending cash. You could actually profit from spending cryptocurrency via a crypto debit card compared to spending cash.

Anonymity. Some crypto debit cards will enable you to remain anonymous if you're spending small amounts of money.

All of this adds up to a powerful engine for mainstream adoption by regular folks. Crypto debit cards represent the merging of two worlds -- the innovation of cryptocurrency with the practicality of debit cards.

How crypto debit cards work

Crypto debit cards work just like any other debit card at the point of sale or ATM. Instead of drawing from a bank account, however, the card draws from a cryptocurrency wallet. When you make a purchase with a crypto debit card, only the amount of cryptocurrency you need is sold for fiat currency. That fiat currency is then sent to the merchant in a seamless process you aren't even aware of.

The steps to set one up are simple: Order the card, activate it, load money by transferring some cryptocurrency to the card vendor's wallet service and then spend the money.

How entrepreneurs can take advantage

The market for crypto debit cards is just getting started. Entrepreneurs looking to take advantage of it need to keep this in mind: Avoid limits as much as possible. Cryptocurrency users hate limits. Think outside the traditional limits. We're building a new world here -- one in which entrepreneurs can:

Reduce and simplify fees. Many options in the crypto debit card market right now are loaded with fees, from monthly fees to loading fees to withdrawal fees and more.

Reach the unbanked. As many as 2.5 billion adults globally are not using banks. But they do have cellphones. These folks are a prime market for cryptocurrency services. Entrepreneurs can make it easy for them to access educational and other services using crypto debit cards.

Two-and-a-half billion people is a huge market. Just the other day, I came across a thread of people in the developing world begging an online education provider to accept Bitcoin. That's just one opportunity. One.

In sum, crypto debit cards are turning national currencies into an app that fits in your wallet. The crypto debit card is the next-level innovation that's going to rocket cryptocurrencies into the mainstream for everyday consumers. Because, when you can spend these currencies with ease, there's a good reason believe that you'll be able to earn it as well, and that the crypto economy will only grow.

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